Tuesday, January 13, 2026- Federal prosecutors in Washington, D.C., have opened a criminal investigation into Federal Reserve Chair Jerome Powell, marking an extraordinary escalation in tensions between the nation’s top central banker and the federal government.
The inquiry, approved in November by the U.S. Attorney for the District of Columbia, Jeanine Pirro, focuses on whether Powell made false or misleading statements to Congress about the scope and cost of a major renovation project at the Federal Reserve’s headquarters. The investigation includes a review of Powell’s congressional testimony and internal spending and planning records tied to the project. As of now, no criminal charges have been filed.
Powell has responded forcefully, saying the investigation threatens the independence of the Federal Reserve and reflects ongoing political pressure. He highlighted that the Justice Department served grand jury subpoenas and threatened a criminal indictment related to his testimony before the Senate, which he described as a “pretext” rooted in disputes over monetary policy decisions rather than genuine legal violations. Powell emphasized that setting interest rates based on economic conditions rather than political preferences is central to the Fed’s mission.
The probe has drawn sharp reactions from lawmakers and former Fed officials. Critics across both parties warn that targeting a sitting Fed chair is unprecedented and risks undermining confidence in the central bank’s autonomy.
Some lawmakers have pledged to block future Fed nominations until the matter is resolved, while former Treasury and Fed leaders have voiced concern about the potential erosion of institutional independence. The controversy adds significant political and economic uncertainty just months before Powell’s term as chair is set to expire.
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